The world is going through a difficult period but the US economy is in good shape to cope, Treasury Secretary Robert Rubin said after the Dow Jones industrial average lost 512.61 points, or 6.37 percent, in one of Wall Street's biggest retreats. August was the first month in eight years that investors took more money out of stock funds than they put in, reported Trimtabs.com, which tracks 3,400 mutual funds.
Some closely watched economic reports gave mixed signals. The Conference Board, a private research group, said its index of leading economic indicators for July stood at 105.4 - up 0.4 percent, well ahead of economists' expectations of a 0.2 percent gain. The National Association of Purchasing Management said its index of business activity stood at 49.4 percent in August. A reading below 50 signals a contraction in the industrial sector. And the Commerce Department said construction spending rose 0.4 percent in July to a record high.
Talks began in Miami to create a Free Trade Area of Americas, running from Alaska to the tip of South America by 2005. Negotiations on reducing tariffs are expected to pit nations wanting to defend agricultural sectors - Canada and the US - against Latin American countries seeking to protect their industries, economists said.
President Clinton asked Transportation Secretary Rodney Slater to meet with both sides in the Northwest Airlines dispute in an attempt to restart negotiations. The parties appear able to engage in a long standoff. The airline reportedly has $3 billion available to wait out its striking pilots, who reportedly have about $65 million in their own fund. Northwest officials have estimated that the strike would cost the carrier $175 million in its first 10 days.
Tropical storm Earl formed in the Gulf of Mexico, and forecasters said it may pose a hurricane-size threat to some Gulf-coast states later this week. They said Earl, which is expected to gain strength as it moves north, could touch the mainland anywhere from the Texas-Louisiana border to the Florida panhandle.
More suspects in the East Africa embassy bombings are expected to be sent to the US later this week to face criminal charges, law-enforcement officials said. The additional suspects are likely to be sent to New York, where two men extradited by Kenya last week have been charged with murder in the massive truck bombing of the embassy in Nairobi.
There is no evidence to support the theory that soldiers in the Persian Gulf War were exposed to nerve gas, a study by a Senate panel concluded. The Senate Veterans Affairs Committee issued a bipartisan report generally supporting the military's assertion that chemical weapons were not to blame for illnesses associated with the war. But the report seriously questioned a Pentagon conclusion last year that up to 100,000 soldiers were exposed to low doses of nerve gases in March 1991, days after the war ended.
The Teamsters Union executive board voted to contribute up to $2 million toward the cost of a new election to replace former president Ron Carey. US District Judge David Edelstein had pressed union officials to help fund new balloting after Congress limited to $4 million the government's share of the estimated $8 million cost of supervising the election..
A proposal to amend the Alaska constitution to bar same-sex marriages may remain on the general-election ballot in November, a state judge ruled. In superior court in Anchorage, Judge Sen Tan said he issued his ruling as soon as possible in part to allow for likely appeals to the state Supreme Court. He let the wording of the ballot question stand, rejecting GOP legislators' arguments that it was biased against the amendment because it describes the measure as "limiting" marriage rights.
In Moscow, President Boris Yeltsin assured President Clinton that Russia's market reforms were irreversible. And Clinton promised US support as long as the reforms go forward. Meanwhile, the first agreement to trickle out of the summit was a joint pledge to eliminate some stockpiles of plutonium taken from dismantled missile warheads. A draft statement said the plutonium would be withdrawn in stages, with financing arrangements to be set by year's end.
Japan issued a strongly worded protest against yesterday's test-firing of a long-range ballistic missile by North Korea and said it was freezing future food aid and $1 billion in development assistance to the beleaguered Communist country. The North Korean missile's range is sufficient to hit many parts of Japan, which has no early warning system.
Police killed two rioters and wounded at least 12 others as separatist demonstrations in Indonesia's volatile Aceh Province continued into a second day following the withdrawal of the Army, reports said. Rock-throwers drove Chinese merchants to cover inside their shops, dozens of inmates ran free after demonstrators attacked a prison in the industrial city of Lhokseumawe, and mobs burned a hotel and other buildings.
Despite a summer of violence in Kosovo, more than 350,000 students were due in school for the first day of classes. But it was unclear how many would return because of ethnic fighting that has killed more than 500 people and driven an estimated 265,000 others from their homes - most of them Albanians. There is little contact between Kosovo's Albanian and Serb school children, who are taught separate subjects in their own languages.
A state-of-the-nation address focusing mainly on stabilizing the economy was to be presented by Mexican President Ernesto Zedillo. But analysts said it was likely to meet with a skeptical response from opposition legislators, who hold their first majority in Congress in almost 70 years. Mexico has been hard-hit by global economic problems - among them the sagging price of oil. Zedillo also has struggled to win support for his policy toward the Zapatista rebel movement in the state of Chiapas.
The worst floods in 10 years prompted Bangladesh to appeal for $879 million in new international aid. At least 513 people have died in the flooding, which has left an estimated 25 million others homeless or marooned. Disaster-management officials said three-quarters of the country was submerged.
Vietnam's leading political dissident was freed from prison under an amnesty marking the independence-day holiday. But despite his desire to remain there, Doan Viet Hoat was escorted aboard a flight to Thailand, after which he is expected to travel to the US for re- settlement. Hoat was sentenced to a 15-year term in 1993 after calling for the abolition of the Communist Party. Human-rights groups praised the amnesty, but critics said it was likely offered as a way to improve Vietnam's image and to attract new foreign investment.
All four Cabinet ministers from the former rebel UNITA movement were fired by Angolan President Jos Eduardo dos Santos, reports said. Their dismissal came amid growing worries that the country's long civil war is about to resume. The UNITA ministers joined the government last year under a 1994 accord. But with the peace process breaking down, the UN Security Council last week extended the mandate of its observer force by one month.
"The fundamentals of the United States economy are strong.... The prospects for growth, low inflation, low unemployment continue to be strong." - Treasury Secretary Robert Rubin, offering reassurance after one of Wall Street's worst days.
With summer winding down, what better time to squeeze in a cookout, they decided at the Salvation Army's homeless shelter in Appleton, Wis. So preparations began: the menu-planning, coming up with the money to buy food, the setting up, and, of course, the cooking and serving. As usual, the shelter's two- dozen volunteers took away a sense of fulfillment from the experience. And why not? You see, this time the tables were - literally - turned. The whole thing was the residents' way of saying "thank you" for making their lives a little easier.
If you worked for the state of Michigan's Underwater Recovery Unit, you'd bring things back to the surface that had sunk, right? Usually, but not always. Last week, divers restored a rare type of toilet to a freighter that went to the bottom of Lake Huron in 1906 in an area that's now classified as a preserve. The thing was confiscated from a Chicago marina, where a visiting URU employee recognized it from photographs he'd taken of the shipwreck.
The Day's List
'Titanic' Sets Yet Another Record at the Box Office
"Titanic" stole the show at the box office this week by reaching the $600 million milestone in North American sales - the first film to do so - and almost $1.8 billion worldwide. The next highest-grossing film - in dollars not adjusted for inflation - is "Star Wars," which has sales of $461 million in North America, including reissues. The reported grosses for top movies at North American theaters Aug. 28-30 (in millions):
1. "Blade" $10.9
2. "There's Something About Mary" 8.4
3. "Saving Private Ryan" 8.1
4. "54" 6.6
5. "Why Do Fools Fall in Love" 3.9
6. "Ever After" 3.8
7. "How Stella Got Her Groove Back" 3.6
8. "Snake Eyes" 3.57
9. "The Parent Trap" 2.9
10. "Dance With Me" 2.88
- Exhibitor Relations Inc./AP